If your firm isn’t growing, it’s dying.
The accounting industry is becoming dramatically more competitive as waves of private equity capital flow into firms across the nation. Regional and niche firms are being swallowed by larger firms looking for new growth levers. Firms backed by PE are investing aggressively in building out advanced digital marketing and business development teams. Change isn’t coming – it’s already here.
It’s a new way of doing business – one that’s a radically different approach to the traditional organic growth model. Growing top-line revenue a few percentage points each year through existing relationships and referrals is now a losing strategy.
Needless to say, this new climate demands that firms adapt and evolve. And while many are making significant strides toward the future, there are some strategic missteps that firms must avoid if they want to prosper. Chief of those is a lack of closed loop reporting between partners and their growth and marketing teams.
In this overview, we explore exactly what that means and detail strategies that firms can adopt to ensure a more efficient growth strategy.
Closed loop reporting is a vital link in the relationship between growth teams and partners, enabling firms to accurately tie sales opportunities and new business to specific marketing campaigns.
Marketing teams need access to information from partners and business development professionals to determine where to prioritize their resources for optimal growth. Without this collaboration and transparency, it’s extremely challenging for growth teams to advocate for continued investment in their firm’s growth strategy.
Today, the way that firms acquire new clients is markedly different from even five or ten years ago. Your firm’s digital properties now play a pivotal role: your website, email campaigns, social media, and more are all just as important as your relationships.
Many firms receive high-value inbound leads through their website – leads that could be worth anywhere from $25,000 to $150,000. That’s a win for the growth team, who qualify these opportunities and pass them to the relevant partner.
But all too often, partners fail to follow up or report back on how the opportunity progressed. That leaves the marketing team in the dark, with a lot more questions than they have answers. Was the prospect a good fit? Should the marketing team be focusing their efforts on a different type of client profile? Did we win that deal?
In every firm, growth teams face a constant battle to secure the resources they require to be successful in sourcing these new leads. Quantifying performance is a puzzle with many pieces. And one of those pieces is exactly what happens with marketing qualified leads once they’re passed to partners. Without this information, it’s extremely difficult for growth teams to demonstrate the importance of their work and secure the resources they require to ensure your firm stays competitive.
This closed loop reporting challenge might sound familiar to many readers. After all, partners operate in a world where capacity constraints color their every decision. Their top priorities are their existing clients and their team – not necessarily qualifying new leads and pitching new clients.
Amid the daily focus on fulfillment, it’s difficult for partners to invest sufficient time in business development activities. But if your partners don’t, you can bet partners at other firms will. Achieving continued growth demands that partners prioritize business development, even in the face of countless other demands on their time.
Closing the loop between growth teams and partners demands a cohesive, joined-up approach. Effective reporting requires alignment and cross-functional collaboration between marketing, sales, finance, leadership, and operations. To do this effectively, firms have to function as a well-oiled machine, but the reality is that this rarely occurs.
Building a truly scalable growth engine takes more than just proficiency in data and technology – it also demands that everyone in the firm embraces a digital culture. In a truly digital culture, everyone in the firm, from partners to growth teams, adopts digital tools and technologies that unlock efficiencies across the organization.
Embracing a digital culture delivers improved client experiences throughout the sales and onboarding process. When partners and growth teams take a collaborative approach, clients will enjoy a consistent experience in every interaction they have with your firm, creating a cohesive identity that stimulates more productive client relationships.
Closed loop reporting is just one step in this process, but it’s perhaps the most fundamental. By adopting closed loop reporting, firms can ensure everyone has seamless access to the same information. This fosters better decision-making, adds clarity to resource allocation decisions, and strengthens the firm’s growth strategy as a whole.
While the changes required to initiate closed loop reporting are largely cultural, there is a technological component that must be considered. Adopting a Customer Relationship Management (CRM) platform helps streamline the process, consolidating all marketing and business development opportunities into one central tool that both partners and growth teams can access.
Once a firm builds these capabilities, it should never stop exercising them. Incentivize partners to commit to these new methods and secure buy-in from leadership to promote accountability. Over time, a growth team’s goal should be to create a scalable growth engine that predictably drives and converts demand, enabling their firm to grow in a sustainable fashion.
Closed loop reporting might just seem like an attribution matter, but as we’ve outlined here, it’s a practice that has a significant impact on a firm’s overall growth strategy. By failing to adopt closed loop reporting, firms are implicitly choosing to have their growth teams operate blindly.
That’s a position that no firm can afford to find themselves in in today’s accounting industry. The pivot to a digital culture does not occur overnight: new technologies have to be adopted and behaviors have to change. But by adopting closed loop reporting, firms are taking the first step toward a brighter future.
At Winding River Consulting, our expertise lies in helping accounting firms build for the future. We offer a slate of industry-leading professional education programs centered around digital culture and strategy, and also provide a suite of consulting and advisory services that offer firm leaders a more bespoke approach.
Ready to take the first step toward a more prosperous future? Contact us today.